The launch of stateless validation in August 2024 marks an important milestone for NEAR Protocol, but it is by no means the end state of the protocol. There is still a lot of ambitious work to be done.

In less than four years since launching mainnet, the NEAR network has over 110 million users – a great achievement for the ecosystem. But the goal for NEAR is to onboard a billion people to the User-Owned Internet. Achieving such widespread usage will require an even more scalable, performant, secure, and fast protocol. The Near One team is already working to make improvements to Nightshade 2.0 and has started planning the next round of advancements. In this post, we describe what the protocol roadmap looks like for the rest of 2024 and into next year.

First of all, while the stateless validation launch is a major change to the protocol, it does not immediately improve the performance of mainnet. This is because we intentionally keep the upgrade as simple as possible to avoid adding more complexity into the already humongous upgrade. To fully reap the benefits of the new design, there are a number of improvements on top of the release that we will work on for the rest of 2024 following the August launch:

• Optimization of state witness size. In the current implementation, state witness size could be quite large, primarily due to the size of contract code included in a state witness. Optimization of state witness size will reduce the likelihood of a chunk hitting the size limit, thereby improving transaction throughput.
• Reduce gas cost for storage operations. One of the key benefits of stateless validation is that state accesses (reads and writes) are now fully in memory. It means that the gas cost of state accesses could be significantly reduced, which allows for higher transaction throughput.
• Resharding. The launch of stateless validation means that no validator node needs to track all shards, which enables scaling to potentially many more shards. However, due to the architectural change, the old method of resharding no longer works and a new method needs to be developed and tested. The new method of resharding will be quite fast and will lay the groundwork for dynamic resharding (see more about this development below).
• Node synchronization. While not strictly related to stateless validation, the synchronization time for a mainnet node has been a pain point for many node operators. Work will be done in this area both to improve the speed of synchronization and ensure that the synchronization process does not depend on centralized services.

In addition to the immediate priorities listed above, there are some long-term improvements that we intend to work on starting in early 2025:

• Transaction priority fee. In the stateless validation launch, we introduced congestion control that provides better latency for accepted transactions under congestion conditions. However, users may want to pay more to get to the front of the queue for certain use cases such as trading or arbitrage. Establishing a transaction priority fee mechanism will make NEAR easier to use when there is short-term congestion.
• Dynamic resharding. The holy grail of sharding: the network dynamically adjusts the number of shards based on the load. When a shard is overloaded, it splits itself into two shards. Similarly, when two shards are both underutilized, they get merged back into one shard for the sake of efficiency.
• Runtime performance improvements. There are a number of ideas that we’d like to experiment with to improve runtime performance of NEAR, which includes pipelining contract execution, parallel execution of transactions and receipts, and using an optimizing compiler for wasm.
• Leaderless consensus. The current consensus mechanism degrades in performance when some nodes are offline, which could happen during a protocol upgrade. A leaderless consensus is much less sensitive to a small number of nodes being offline and can also provide higher throughput.
• Sharded smart contracts. Today each smart contract resides on a specific shard. While the more shards there are on mainnet, the better the overall throughput will be, a smart contract per se cannot take full advantage of NEAR’s sharding. Allowing a smart contract to be sharded (exist on all shards simultaneously) could unlock use cases that are not possible today and make it possible to build dapps with hundreds of millions of users on NEAR.

These initiatives will significantly improve the performance and scalability of NEAR and make it possible to support hundreds of millions, even a billion daily transactions. The new level of scalability lays a solid foundation for the different verticals of initiatives in the NEAR ecosystem, such as Chain Abstraction, Modularity, and User-Owned AI. Stay tuned for more on performance and efficiency improvements in the coming months and a more detailed future roadmap update towards the end of the year.

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• Introduces stateless validation: an innovative approach to validating state transition, or the process of updating the status of all the data posted to the blockchain. Now, NEAR validators no longer have to maintain the state of a shard locally.
• Scalability, usability improvements: Nightshade 2.0 Improves single-shard performance significantly and adds capacity for more shards: NEAR currently has 6 shards and the plan is to have 10 shards by the end of 2024.
• Advancing towards NEAR vision: Upgrades NEAR’s already high-performance and scalable infrastructure to support the growing number of users and activities in the NEAR ecosystem, including consumer apps, Chain Abstraction, modularity, DeFi, and User-Owned AI, to a billion users and beyond. NEAR saw over 20 million monthly active users in July 2024, with over 110 million accounts overall. 

Nightshade 2.0, the latest advancement in the NEAR Protocol sharding roadmap, is now live on Mainnet. This upgrade introduces stateless validation and improves the scalability, performance, and decentralization of the protocol. Nightshade 2.0 is a major milestone for the NEAR network, marking the biggest change to the protocol since mainnet launched in October 2020. 

Introducing Stateless Validation

Introducing stateless validation to the sharding architecture of NEAR Protocol both improves single-shard performance as well as adds capacity for more shards on the network. The upgrade happens live, without affecting mainnet users and applications. Currently at six shards, NEAR aims to have ten shards by the end of 2024. 

Stateless validation is an innovative approach to validating state transition, or the process of updating the status of all the data posted to the blockchain. Sharding is NEAR’s unique approach to scaling, which partitions the blockchain into multiple parallel “shards.” With Nightshade sharding, both the state and processing are divided among shards. Now, NEAR validators no longer have to maintain the state of a shard locally and can retrieve all the information they need to validate state changes, or “state witness,” from the network. Stateless validation was originally proposed by Vitalik Buterin in 2017 and NEAR is one of the only blockchain networks to implement the approach. 

Unlocking Even Higher Performance & Scalability

In Nightshade 2.0, validators no longer need to track all shards and there are lower hardware requirements and costs for running a validator, potentially allowing more validators to join the ecosystem—which will further decentralize the network and enhance its security over time. 

“Nightshade 2.0 is a fundamental reworking of NEAR sharding and is a major milestone in NEAR’s development roadmap that will greatly increase NEAR’s efficiency and scalability,” said Bowen Wang, Head of Protocol at NEAR One. “In particular, the new sharding implementation paves the way to significantly increase NEAR’s already-fast transaction throughput. It also substantially lowers the cost of operating validators, lowering the barrier to entry for  more people to become validators, which will improve the decentralization of the network. These performance and scalability upgrades will ensure that NEAR remains fast, cost-effective, and efficient even with millions more users.” 

“Nightshade 2.0 solves the fundamental bottleneck issue on most L1s of how to scale while preserving both usability and security,” said Illia Polosukhin, Co-Founder of NEAR Protocol and CEO of the NEAR Foundation. “By improving the performance of each shard and adding more shards, while also further decentralizing the network, NEAR sets yet another new technical standard with this upgrade. With Nightshade 2.0, NEAR sharding now enables the network to support hundreds of millions of users with high performance and speeds across consumer apps, modularity, Chain Abstraction, DeFi, and User-Owned AI.”

What’s Next for NEAR Sharding?

How does Nightshade 2.0 fit into the long-term sharding roadmap for the NEAR Protocol? Nightshade 2.0 is a shift in direction from the original Nightshade sharding architecture NEAR launched with in 2020, bypassing some fundamental roadblocks in that protocol design around the implementation of challenges in the initial idea of Phase 2, while also unlocking additional benefits. 

From here, the focus for the remainder of 2024 will be on making further performance improvements and optimizations on top of those unlocked by Nightshade 2.0. These include introducing a new method of resharding, reducing gas costs for storage operations, and optimization of state witness size. Starting in early 2025, planning for the next phase of NEAR scalability and sharding will begin, including on dynamic re-sharding, the holy grail of sharding, where the network dynamically adjusts the number of shards based on the load. The Near One team will share a more detailed roadmap update in the coming days. 

For more information on Nightshade 2.0, watch Bowen Wang and Illia Polosukhin’s Whiteboard Series unpacking the NEAR Protocol. For deep technical details on how NEAR sharding and stateless validation works, read the Nightshade 2.0 whitepaper. 

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TLDR: 2023 saw major experience improvements via meta transactions and zero-balance accounts, as well as node performance improvements and optimizations. Preparations are underway for a major upgrade to stateless validation, completing Phase 2 of the sharding roadmap in early 2024.

What we accomplished in 2023

There were a total of six protocol upgrades in 2023 which introduced a number of new protocol features. Meta transactions were added as a protocol feature at the beginning of the year to support gasless transactions, which means that users can transact on NEAR and start using apps without necessarily needing to pay transaction fees in NEAR. We also added zero-balance accounts, an important feature that enables users to create an account without holding NEAR to pay for storage. This makes it easy to onboard new users to applications. These two features form a solid foundation for a seamless onboarding experience for end users — a top goal for NEAR overall.

In addition to easy user onboarding, we have also been working hard to optimize the performance of NEAR. Flat storage, which was released in Q2 this year, optimized state reads and improved the stability and performance of the network overall. Another feature that optimizes NEAR nodes is cold storage, which allows for a split between hot and cold storage for a node. This means an archival node does not need to store most of the historical data on SSD and therefore can save a lot on cost. We also optimized the network communication between validator nodes by introducing the tier1 network, which reduces the latency of network messages between two validator nodes. Furthermore, we improved state sync and reduced the time it took a node to synchronize the latest state. We have also worked on improving the stability and maintainability of contract runtime with initiatives like finite wasm and limited replayability.

There are a few major initiatives that we started this year and expect to finish next year, such as stateless validation, congestion control, and transaction priority. We will dive deeper into those in the section below.

Plans for 2024

There are a few major projects that we want to deliver in 2024 to improve the usability, scalability, and decentralization of NEAR Protocol:

• Stateless validation. Stateless validation is a major initiative that we have been working on for a few months. It adjusts the original Nightshade sharding design to avoid implementing fraud proofs while improving the performance of each shard significantly by putting state in memory. The stateless validation work is expected to be delivered in Q2 2024, which would also mark the completion of the original goal we set for Phase 2 of sharding. We expect the launch of stateless validation to also dramatically increase the throughput of each shard and prepare NEAR for the continued growth of usage.
• Congestion control and transaction priority. While NEAR’s sharding design is horizontally scalable, it is important to provide a good user experience when there is short-term congestion on the network. This includes localizing congestion so that gas price increase does not affect the entire network and allowing users to prioritize their transactions during congestion if they are willing to pay more in transaction fees.
• Support for account aggregation. Account aggregation allows a user to control accounts on different chains with one NEAR account, an important pillar of the chain abstraction vision for NEAR. It requires chain signatures, which does MPC to sign payload. This requires a new runtime API to facilitate the asynchronous nature of chain signatures.
• zkWASM. We have been working on zkWASM with the Polygon team for a few months and the work will continue in 2024. The goal is to build a prover for WebAssembly smart contracts. This could be used as a part of the initiative to prove the state transition of NEAR in a ZK proof. Moreover, zkWASM also provides wasm as an alternative execution environment to EVM for L2s.
• Data availability improvements. We launched NEAR DA in early November 2023 and there are a few things that we plan to work on to further improve the efficiency of NEAR DA. Those improvements include introducing KZG commitment to avoid having data availability fraud proofs, as well as real-time bridging to allow verification of data availability on Ethereum.
• Ethereum wallet support. Supporting wallets like MetaMask natively on NEAR allows us to attract more users to NEAR and also be more Ethereum aligned. This requires changes to the protocol to support Ethereum addresses natively and support processing of RLP serialized Ethereum transactions.
• Research into the future of sharding. There are two major directions of exploration: synchronous sharding and ZK-centric sharding. Synchronous sharding enables synchronous execution of smart contracts and addresses the developer experience pain point of having to deal with asynchronous execution. ZK-centric sharding leverages zero-knowledge proofs to validate state transition of different shards and improves the scalability and decentralization of the protocol. In addition, we will also research the next and final phase of sharding: dynamically adjusting the number of shards based on usage.
  

The roadmap can be seen below for those interested in more timeline specifics. It is split into two parts: Experience and Core. The Experience section encompasses user and/or developer experience and the protocol features needed to enable those experiences. As an example, synchronous execution addresses the pain point that developers feel when they implement cross-contract calls.

The Core section, on the other hand, covers major efforts to improve the scalability and decentralization of the protocol. This includes stateless validation, zkWASM, improvements to data availability, and so on.

As always, the protocol team is proud to have made several important improvements to the core protocol with zero disruption for users and developers. We look forward to making some major advancements in 2024 to help the entire NEAR ecosystem deliver its vision of mainstream adoption of an Open Web, where all internet users can control their own data, assets, and power of governance. 

We will share more details on Phase 2 advancements and timelines soon. If you’d like to learn more, join the NEAR Protocol X Spaces on Tuesday, January 16 at 5pm UTC to hear from Director of Protocol Bowen Wang and NEAR Foundation CEO Illia Polosukhin on upcoming protocol developments.

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What the protocol team accomplished in Q2

Pagoda made good progress on the protocol roadmap in Q2. For the experience section, there is now a NEP on account namespaces, a key stepping stone towards account extension. Account extension would allow users to easily compose different modules such as multisig, proxy, and so on. In addition, Aurora submitted a NEP on wasm submodules, which, if implemented, would enable a limited form of synchronous execution, or allowing transactions that touch multiple contracts to settle within a single block. Both proposals are still works in progress due to the complexity of the changes. 

On top of these two proposed changes, there is a NEP on shared storage for contract code which could significantly lower the cost of deploying a common contract. These proposals aspire to bring to life the account extension idea, which allows an account to install different modules to different functionalities such as multisig, recovery, proxy, and so on.

For the core section of the roadmap, Pagoda delivered a few important improvements this quarter. Flat storage with value inlining is live on mainnet and brings an 8x improvement to state reads. Work on background writes is also in progress and the protocol team’s initial experiments show that it can potentially reduce the cost of state writes by 3x. In addition, cold storage is fully live on mainnet and drastically reduces the cost of running an archival node.

Pagoda has also made good progress to revamp state sync. With the growth of mainnet state, the previous version of state sync was too inefficient and practically unusable. The new state sync, which uses flat storage to speed up state part generation, allows a node to finish syncing mainnet state within 3 hours. The team is expected to deliver the fully functional version of the new state sync in Q3.

The team has also delivered finite wasm and its integration with nearcore, which improves the security and robustness of NEAR’s contract runtime immensely.

Updates to the roadmap

The experience section of the roadmap remains mostly the same, with two changes worth highlighting. One shift is that the changes required to implement account extension are temporarily on hold as we would like to see the impact on user experience by first emulating the changes through smart contracts. Another change is that the protocol team will work on the storage refund problem to prevent potential faucet-draining attacks in the new onboarding experience.

For the core section of the roadmap, the focus in Q3 will shift to Phase 2 of sharding, which includes both resharding the current mainnet state and turning off the requirement that block producers have to track all shards. This endeavor will take more than one quarter to finish and we will post more updates as we iron out details of the design.

To stay up to date with protocol changes as they happen, or to participate in protocol governance, please join the protocol community group and follow the NEAR Enhancement Proposal (NEP) process.

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